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DECISION No

DECISION No. 58/2003/QD-TTg OF APRIL 17, 2003 AMENDING AND SUPPLEMENTING THE GENERAL PLANNING ON DEVELOPMENT OF VIETNAM’S BREWING INDUSTRY TILL 2010

THE PRIME MINISTER

Pursuant to the Law on Organization of the Government of December 25, 2001;

Pursuant to the Prime Minister’s Decision No. 125/QD-TTg of January 28, 2003 approving the general scheme for reorganization and renovation of State corporations and State enterprises under the Ministry of Industry in the 2003-2005 period;

At the proposal of the Ministry of Industry in Report No.1243/TTr-KHDT of April 2, 2003 regarding the amendment and supplement of the general planning on development of Vietnam’s brewing industry till 2010,

DECIDES:

Article 1.- To ratify the amendments and supplements to the general planning on, and a number of solutions to, the development of Vietnam’s brewing industry till 2010, with the following principal contents:

1. Objectives:

- To build Vietnam’s brewing industry into a strong economic branch. To make the fullest use of domestic raw materials in order to develop the production of high-quality products of diversified categories and with better packing and designs; to strive for lower production costs and higher competitiveness of products with a view to meeting the domestic demand and having products for export; to increase budget revenues and firmly integrate into the regional and international economies.

- To build Hanoi Beverage Corporation and Sai Gon Beverage Corporation into two strong corporations, which play the key role in liquor and beer industry and act as core in the production of high-quality soft drinks.

- To encourage various economic sectors to participate in the production of high-quality soft drinks from domestic raw materials, thus meeting domestic consumption and export demands.

2. Development orientations:

a/ Regarding technologies and equipment: To modernize technologies, step by step replace the existing technologies and equipment with the world’s advanced and modern ones up to the Vietnamese and international standards on food and environmental quality, safety and hygiene and capable of turning out products with higher and higher competitiveness on the domestic and overseas markets.

b/ Regarding investment: To concentrate investment in breweries with large capacities; make the fullest use of the capacities of production establishments furnished with advanced equipment and technologies; at the same time invest in the expansion of a number of the existing breweries. To diversify the investment forms and capital mobilization modes, encouraging the mobilization of capital sources from the domestic economic sectors, issuing bonds and share certificates; and accelerate the equitization of enterprises where the State does not need to hold 100% of their capital.

c/ Regarding scientific research and training: To plan and build laboratories and research centers; deploy experiments in association with the scientific and technological application to production; and at the same time work out planning on arrangement and training of the contingent of science personnel and technical workers, thus meeting the branch’s development requirements.

3. Main targets:

a/ Regarding beer:

- Output:

By 2005: 1,200 million liters;

By 2010: 1,500 million liters.

- Hanoi Beverage Corporation and Sai Gon Beverage Corporation shall strive to play the key role in promoting the trademark prestige of Vietnamese beers, thus ensuring that the production and sale thereof covers 60-70% of the domestic market and producing to export them.

- To concentrate investment in breweries with large capacities, efficient production and business operations, and a tight management over food hygiene and safety of products, ensuring the quality and prices acceptable to consumers, more concretely:

+ To construct a new beer factory in Cu Chi district under Sai Gon Beverage Company with an output of 100 million liters/year (in the 2002-2005 period), which may be raised to 300 million liters/year in the subsequent years.

+ To construct a new beer factory under Ha Noi Beverage Company with an output of 100 million liters/year, which may be raised to 200 million liters/year in the subsequent years.

- Foreign-invested enterprises shall strictly comply with their investment licenses and concentrate on fully exploiting their designed capacities as approved. In the years to come, the granting of licenses for establishment of new joint ventures or for raising the production capacities of the existing establishments shall not be considered.

b/ Regarding liquor:

- Output:

By 2005: 250 million liters;

By 2010: 300 million liters.

- Hanoi Beverage Corporation and Sai Gon Beverage Corporation shall play the key role in the production of traditional specialty liquors and high-quality liquors to meet the domestic and export demands; and take appropriate measures to gradually reduce the percentage of manually distilled liquors.

- To enhance the State management over liquor production and consumption.

- To concentrate investment in the renewal of equipment and technologies, boost the production of high-quality industrial liquors with minimum toxic contents.

- To propose the cooperation or joint ventures with foreign countries in the production of a number of high-quality liquors from domestic raw materials to substitute for imports.

- In the 2001-2005 period, Ha Noi Liquor Company and Binh Tay Liquor Company shall make investment in the renewal of their technologies and equipment, in order to raise their respective capacity to 5 million liters of starch alcohol and 10 million liters of assorted liquors per year, which may be doubled in the subsequent period.

c/ Regarding soft drinks:

By 2005: 800 million liters;

By 2010: 1,100 million liters.

- Hanoi Beverage Corporation and Sai Gon Beverage Corporation shall play the key role in raising the quality of soft drinks and lowering production costs; and at the same time, encourage all economic sectors to participate in the production of soft drinks from domestic raw materials, with priority given to raising the output of fruit juices, and no investment in raising the output of aerated soft drinks prepared from imported flavors.

Article 2.- Organization of implementation; responsibilities of the ministries, branches, Hanoi Beverage Corporation, Sai Gon Beverage Corporation and concerned localities

1. The Ministry of Industry:

- To assume the prime responsibility and coordinate with the concerned ministries and branches, Hanoi Beverage Corporation and Sai Gon Beverage Corporation and the People’s Committees of the provinces and centrally-run cities in working out the equitization roadmap; drawing up the list of enterprises where the State holds prevailing stakes in the brewing industry; and at the same time direct the reorganization of the existing brewing establishments.

- To arrange new investment projects in line with the planning of each region or each locality.

- To direct Hanoi Beverage Corporation and Sai Gon Beverage Corporation to coordinate with localities in reorganizing the breweries equipped with advanced technologies but having conducted production and business operation with less efficiency, and failing to meet the quality and food hygiene as well as safety standards or to fulfill the annual budgetary remittance obligation. Small-sized breweries or those with obsolete technologies should either to switch to new production and business lines or conduct their equitization, sale, contracting, lease, dissolution or bankruptcy according to regulations.

- To coordinate with the concerned ministries and branches in promulgating documents concerning activities of producing and trading in liquors, beers and soft drinks.

- To base itself on the objectives and targets set in the branch planning to direct the planning implementation, organize the periodical appraisal thereof and propose readjustment of the planning in conformity with specific socio-economic conditions of the whole country.

2. Hanoi Beverage Corporation and Sai Gon Beverage Corporation:

- To assume the prime responsibility and coordinate with localities in reorganizing the production and trading of liquors, beer and soft drinks within the whole branch; build a number of member units to act as core foregoers in technological and equipment renewal, production rationalization, production cost reduction and product quality raising in the provinces and centrally-run cities throughout the country.

- To coordinate with localities in studying the growing of wheat and rye in the country to partially substitute imported raw materials in order to step by step turn out products for export.

3. The Ministry of Planning and Investment, the Ministry of Finance, the Ministry of Trade, the Ministry of Agriculture and Rural Development, the Ministry of Science and Technology, the Ministry of Natural Resources and Environment, the Ministry of Health, the State Bank of Vietnam, and the Development Assistance Fund shall, within the ambit of their respective functions, coordinate with the Ministry of Industry, Hanoi Beverage Corporation and Sai Gon Beverage Corporation in:

- Studying and proposing policies on assisting and mobilizing investment capital sources for production projects and raw material areas of the brewing industry.

- Promulgating beverage quality standards and coordinating with localities in organizing the inspection of product quality, thus ensuring the observance of food safety and environmental hygiene standards as well as the industrial property legislation.

- Formulating the regulation against dumping sale, inferior-quality goods, counterfeit goods and smuggled goods as well as the regulation on sale promotion, advertising, marketing and goods labeling applicable to liquors, beers and soft drinks circulated on the domestic market.

- Enhancing management through the business registration and quality registration, ensuring the fulfillment of tax obligations by medium- and small-sized establishments producing and/or trading in liquors.

- Scrutinizing and handling according to the provisions of the Foreign Investment Law the joint ventures with foreign countries engaged in beverage production but having suffered chronic losses.

4. The People’s Committees of the provinces and centrally-run cities:

- To direct local beverage enterprises to conduct their activities strictly according to the branch’s set objectives and development orientations. To attach importance to sustainable development of local raw materials areas with a view to sufficiently supplying raw materials for production and at the same time creating more jobs and raising living standards of laborers.

- To coordinate with the Ministry of Industry, the concerned ministries and branches and Hanoi Beverage Corporation and Sai Gon Beverage Corporation in arranging enterprises and managing production and trading activities of the brewing industry in geographical areas managed by the provinces or centrally-run cities.

Article 3.- This Decision replaces Decision No. 28/2002/QD-TTg of February 6, 2002 and takes effect 15 days after its publication in the Official Gazette. To annul previous stipulations which are contrary to this Decision.

Article 4.- The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government, the presidents of the People’s Committees of the provinces and centrally-run cities and Hanoi Beverage Corporation and Sai Gon Beverage Corporation shall have to implement this Decision.

For the Prime Minister

Deputy Prime Minister
NGUYEN TAN DUNG

APPENDIX 1

PRODUCTION OUTPUT OF THE BREWING INDUSTRY

(Promulgated together with the Prime Minister’s Decision No. 58/2003/QD-TTg of April 17, 2003)

Calculation unit: Million liters

Targets

By 2005

By 2010

I. Beer production

1,200

1,500

1. Total output of the two corporations under the Ministry of Industry:

550

780

- Sai Gon Beverage Company

350

430

- Ha Noi Beverage Company

100

200

- Other breweries

100

150

2. Joint ventures and 100% foreign capital enterprises

350

400

3. Localities and other economic sectors

300

320

- Localities

200

270

- Other economic sectors

100

50

II. Liquor production

250

300

1. Industrially produced liquors

120

220

2. Liquors distilled by people

130

80

III. Production of soft drinks

800

1,100

1. Aerated soft drinks

350

380

2. Mineral water and purified water

326

440

3. Fruit juices

124

280

APPENDIX II

INVESTMENT CAPITAL DEMAND OF THE BREWING INDUSTRY

(Promulgated together with the Prime Minister’s Decision No. 58/2003/QD-TTg

of April 17, 2003)

Calculation unit: Billion dong

Targets

By 2005

By 2010

I. Beer production

2,870

4,060

1. Total investment capital demand of the two corporations under the Ministry of Industry:

2,730

3,780

- Sai Gon Beverage Company

1,680

2,100

- Ha Noi Beverage Company

700

1,400

- Other breweries

350

280

2. Localities

140

280

II. Liquor production

600

1,080

1. Industrially produced liquors

600

1,080

III. Production of soft drinks

381

2,862

1. Aerated soft drinks

86

144

2. Mineral water and purified water

150

456

3. Fruit juices

145

2,262

Total:

3,851

8,002